Evidence of meeting #15 for Agriculture and Agri-Food in the 41st Parliament, 1st Session. (The original version is on Parliament’s site, as are the minutes.) The winning word was farm.
A recording is available from Parliament.
4:20 p.m.
President and Chief Executive Officer, Canadian Vintners Association
The penalties for the first offence are, I think, $200; for the second offence, $600; and for the third offence, between six and twelve months in jail.
4:20 p.m.
Conservative
LaVar Payne Conservative Medicine Hat, AB
My goodness. That sounds a little drastic. Thank goodness I don't have a car to--
4:20 p.m.
President and Chief Executive Officer, Canadian Vintners Association
And you get a criminal record.
4:20 p.m.
Conservative
LaVar Payne Conservative Medicine Hat, AB
Fortunately, I don't take a suitcase back and forth.
You did indicate the drop in the market down to 32%. Is there any specific reasons for that drop?
4:20 p.m.
President and Chief Executive Officer, Canadian Vintners Association
In part, prior to free trade, the grapes that we were producing were not your typical Chardonnay, Merlot, or Cabernet Sauvignon that the world was used to. They were hybrid grapes that were more in line with the climate in Canada.
Also, the markup structure on foreign wines was significantly higher than it was on domestic wines. So with free trade, national treatment obligations required equivalent cost-of-service provisions to be put in place for both domestic and imported wines, which required us to invest in our vineyards and in new grapes. We had to do a pullout program, that is, to pull out all the hybrid grapes, and transplant those with Chardonnay, Rieslings, etc.
We can do that, and we can produce fantastic wines. However, the cost of production in Canada is significantly higher than it would be in Argentina. As well, the maximum size of the wine industry in Canada is limited by our geography and our climate, so the economies of scale aren't there.
In a nutshell, it does cost more to produce a litre of wine in Canada than it would in many other countries around the world.
4:20 p.m.
Conservative
4:20 p.m.
President and Chief Executive Officer, Canadian Vintners Association
I think the key thing we're trying to get across here is to help support the competitiveness of the Canadian wine industry by addressing barriers to trade as a starting point. The largest barrier to trade that we face right now is within our own country. Moving wine from province to province is very difficult. We are one of the only retailers in the world that has to say no to a consumer who wants to buy our product. But we also depend exclusively on the liquor boards to be able to market our product. They are a fantastic partner when they're selling your wine. However, to be able to sell your wine, there has to be some knowledge of the Canadian wine product out there, which there isn't right now.
That was a point we were trying to make. Our competition is coming to Canada with millions of dollars of federal funds to market their products. California hits every major centre across Canada once per year. The liquor boards love it. When consumers know what your wine tastes like, they want to buy it. It's an opportunity to list that wine in the liquor board.
We don't have that for Canadian wines. We used to. Back around 2000, right after free trade, Agriculture Canada had a program known as Canada à la Carte. The wine industry, the federal government, and the Fairmont hotels partnered. We did white tablecloth tastings with Canadian food across the country. It was a fantastic opportunity. We were very young back then. We're much more mature. It would work better today than it did then. We need that type of program to be able to support Canadian products and encourage Canadians to consume more. If they did, there would be significant dividends.
Within Ontario, the most recent research would suggest there is an $11.50 multiplier on the sale of an Ontario bottle of VQA wine, a $7.72 multiplier on an Ontario bottle of international-Canadian blended wine, and a 67¢ multiplier on a bottle of imported wine, yet imports represent 68% of sales across the country.
4:25 p.m.
Conservative
The Chair Conservative Larry Miller
Thank you very much.
We'll now move to Mr. Atamanenko for five minutes.
4:25 p.m.
NDP
Alex Atamanenko NDP British Columbia Southern Interior, BC
Thank you very much, Larry, and thanks to all of you for being here.
I'll direct my questions to Annamarie and Kevin, if you don't mind.
First of all, congratulations on winning the Canadian outstanding young farmer's award. You also won the B.C. young farmer's award, so very well done. Thank you, and thanks for being here.
I visited your farm and I can see why.... I saw how you went from your double-wide and five acres with no experience to something like 40 acres, a beautiful house, and mentors. It's just an amazing success story.
Thank you for your position on GMOs.
I'd like you to share some of your success story and recommendations with us. You're also very much involved in the organic institute. Kevin, you are the president. You mentioned that you would like to offer another course on ground crops in the spring. I think it would be interesting for the committee to hear how you would do that. I know it would be online, plus hands-on.
The other thing is this whole farm mentorship idea. You have people living, working, and gaining experience there, and then going into agriculture. What role could government play to make it even better?
On my last question, if I remember correctly you almost farm year round with your set-up of greenhouses. How can government assist farmers in doing that so we can get produce going year round?
That's probably enough for my five minutes. Go for it.
4:25 p.m.
Chair, Organic Farming Institute of British Columbia
In the Organic Farming Institute, our courses are all developed so they are online. People all over Canada and internationally can take them. We have some students who have applied from other parts of the world.
The courses are pretty in-depth, with videos. We have a teacher available through email who marks everything. So far we've been putting things together on soil management so people can know how to manage the soil to produce healthy food. Now we've gone to the next step of producing ground crops. That course is going to teach people how to make a living off ground crops.
We have funding through SIBAC to take five acres of land and turn it into a profitable business planting garlic or tomatoes and selling directly, or that kind of thing. We're looking at developing courses in the next few years to help farmers make money. We're talking about ground crops, organic vintners, and greenhouse production year round. We want to start doing business planning.
For the institute it's all about getting young people into farming--or even old people who want to retire at 50 and become farmers, which happens a lot. That's how they spend their retirement.
I think the second question was on our mentorship program and getting people into farming. I guess the biggest thing is land value and help. There isn't really anything out there for people--at least that we know of--to access that through the government. There is a career focus program where they will pay 50% of the wages, but it's really a mentorship program. It doesn't really involve any training per se.
We've gone the extra step and provided training on tractors, business, and marketing techniques through CSA, or community-supported agriculture, to sell through farmers' markets and deal with restaurants and distributors.
Help me out here.
4:30 p.m.
Board Member, Organic Farming Institute of British Columbia
Well, basically it's about how to start a farm from ground zero, basically how to set up a business plan. For example, you can't buy five acres of land and plant carrots and then say you have five acres of carrots. So what are you going to do, how will you sell them, or where will you move them to? You must have a business plan that goes along with that.
If that's what you plan to do, you're going to have to market that and have a market for it before you produce it. A big part of our mentorship program is setting up these things. We don't charge a fee for our mentorship program; it's definitely an on-farm learning experience. They do get paid a stipend, but at the same time it's a modest wage.
Our focus is to get more people into agriculture. If there were government support behind that, it would support some of the learning things we're doing, working 24/7, trying to put these things together. It would be helpful. There are a lot of apprenticeship programs and mentorship programs out there, but there's no standard to them. There is no consistency, so people are getting information from everywhere.
4:30 p.m.
Chair, Organic Farming Institute of British Columbia
There's no funding. Everybody is basically trying to do whatever they can—and that's about it—in trying to help people go into farming.
What was the third question?
4:30 p.m.
Conservative
The Chair Conservative Larry Miller
Be very brief, because we're way over time. I've been generous.
Actually, I think we'll move on to Mr. Lobb for five minutes. You'll maybe get a chance to--
4:30 p.m.
Conservative
Ben Lobb Conservative Huron—Bruce, ON
My first question is for Mr. Paszkowski.
The document you provided focused mostly on retail. In the area I represent, in Huron County they're looking at planting about 100 acres of grapes in the next couple of years. I was wondering if it was simply an omission on your part that there's no focus on R and D for new breeds of grapes or specific types of grapes that will grow in different climates. Is that something your organization supports? Where are we on that one?
4:30 p.m.
President and Chief Executive Officer, Canadian Vintners Association
We developed a national wine and grape strategy that we released in 2007, hoping that it would fit into Growing Forward 1. It dealt with exactly the things you're looking at.
Currently we have research taking place within a region--in Ontario through Brock University, Vineland Research, and in British Columbia through--
4:30 p.m.
Conservative
Ben Lobb Conservative Huron—Bruce, ON
I'll cut you off and say that if there's stuff you'd like to add, in addition to what you've provided to the committee, on what you'd like to see in Growing Forward 2, specifically about R and D or research, or anything you're talking about at the university level or at the crop level, please submit it to the committee. We want to make sure it gets captured.
4:30 p.m.
President and Chief Executive Officer, Canadian Vintners Association
Absolutely. We would welcome that.
4:30 p.m.
Conservative
Ben Lobb Conservative Huron—Bruce, ON
The next question I have is for you folks. One comment you made was about $1 billion in sales. Is that in Canada?
4:30 p.m.
Chair, Organic Farming Institute of British Columbia
That's in Canada, through farmers' markets.
4:30 p.m.
Chair, Organic Farming Institute of British Columbia
No, that's through the farmers' markets.
4:30 p.m.
Conservative
Ben Lobb Conservative Huron—Bruce, ON
Yes, okay.
One question I had for you is this: You talked about funding for infrastructure, education, apprenticeships, and I think you mentioned hoop houses specifically, and maybe greenhouses, and geothermal. Do you think that's something the government really should be investing in? Or should something like a hoop house or geothermal be the primary producer's responsibility to fund, either through capitalization or from cashflow through their operations?
4:30 p.m.
Chair, Organic Farming Institute of British Columbia
Perhaps grants could be available, or something like that, so they could repay it. But a lot of farmers are scratching by with nothing and they don't have capital to do it.
The farmers' markets in Vancouver are actually going a step further and trying to save up money to have a nest-egg fund for farmers so they can get a 0% loan. But again, when you have 70 different farmers and somebody wants to spend $13,000 on a greenhouse, where do you get that money from?
It's one of those things where if you have the money to build it, and then you can make more money from it. But if you don't have the money to begin with and you go to the banks, the banks will look at you and say, “No, you're not making any money so we're not going to lend you any money.” You're stuck between a rock and a hard place. How do you fund something if you don't have any money to fund it with?
4:35 p.m.
Conservative
Ben Lobb Conservative Huron—Bruce, ON
Right.
I have a question for Mr. Sparling. You said that as a class, small farmers lose money. On an income statement, just so we're clear, is that on a net income basis or is that, say, at the contribution margin or the operating margin or EBITDA? I think there is a distinction there.